What should I do if I buy call too expensive

Recently, I saw a post saying that what should Xiaobai do if he buys call high@GoldenAsianWe will talk about this content in this post.

Many people will buy options because of little money, and they will lose all their money in order to gain several times of income.

First of all, analyze the psychology of buying call, buy options outside the extraordinary price, and the expiration date is closer, so that the royalties will be very cheap. If they become options within the price when they expire, the income will often be many times. In fact, this possibility of exploding wealth can easily stimulate gamblers' psychology, so it is very common to buy call.

The threshold of buying call is very low, but the threshold of profit is very high, so it is even more difficult to achieve several times of income. Here are some ways to avoid buying too much call.

1. Simple strategy: only buy flat optionsDon't buy out-of-price options. Although such options are not as explosive as out-of-price options, defensive out-of-price options are much better. For those who don't do technical analysis and just want to gain profits, this strategy is still good.

2. Conservative strategy: buy in-price optionsYou can choose options in the range of 5%-10% of the price. Choosing this type of options can reduce account fluctuations. At the same time, once you encounter the main rising market, the income is also considerable.

3. Radical strategy: buy out-of-price optionsThe selection of out-of-price options is a great test of personal ability. Individual stock prices in different positions often have different selection strategies. At the same time, different stocks often have different fluctuation ranges, and the selection of options will be different.

Next, let's talk about some strategies for selecting call, several elements of options, expiration date, exercise price, subject matter and direction. Here we will mainly talk about the choice of call.

1. The target,It is best to choose stocks in the main rising wave market, and the daily line of individual stocks will steadily rise along the Bolin line. Such stocks will be much higher if they buy call relatively successfully

2. Expiration date,It is better to choose options with an expiration date of more than one month and 1-3 months. If the expiration date is too close, it is easy to make mistakes in judgment, which will lead to the option returning to zero. Moreover, the closer the expiration date is, the lower the fault tolerance rate is.

3. Exercise priceDifferent stocks fluctuate differently, and the way to choose premium is also different. For example, Apple, an out-of-price option with a premium of 10% can already be called a deep out-of-price option, but if it is Tesla, a premium of 10% is not a deep out-of-price option. Moreover, individual stocks are at different stages, and the volatility gap is often very large. Apple, for example, had been consolidating for a long time before this wave of rise. If you buy call in that range, it is difficult to make money even at a premium of 5%. However, in the process of continuous rise in the later period, the fluctuation is obviously enlarged. 10% fluctuation is also possible.

It is often very difficult to be an option buyer, especially to choose out-of-price options. When you are a buyer, the first thing to consider is to calculate the profit-loss ratio. If the profit-loss ratio is too low, it is better not to do it. Not every call will get a good profit, but more often, a burst profit makes up for most of the previous losses and has considerable profits.

If you buy too much, the best way is to cut it directly, although you can also change the expiration date and choose options with the same exercise price and farther expiration date to continue holding. But if we continue to judge wrong, the losses will be even greater.

It is often difficult to be an option buyer, especially an out-of-price option player. If you are not sure, you might as well not do it.$Tesla Motors(TSLA)$$NVIDIA Corp(NVDA)$$AMD(AMD)$$Apple(AAPL)$$TENCENT(00700)$


# 期权大军集中营

Disclaimer: The above content represents only the personal views of the poster and does not constitute investment advice on this platform.

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